205MW of Hydroelectric Power to be Acquired by Fortis Incorporated

---

Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). Fortis Incorporated (TSX: FTS) (St. John's, Newfoundland) has entered into agreements to acquire all the assets of Aquila Networks Canada (Alberta) Limited (Aquila Alberta) and Aquila Networks Canada (British Columbia) Limited (Aquila British Columbia) from Aquila Incorporated (NYSE: ILA) (Kansas City, Missouri) for $990 million. The assets include an electric distribution and transmission system of over 33,000 miles and over half a million customers plus generation assets of 205 megawatts (MW).

The acquisition of the 205MW of generation assets will take place in the first half of 2004 and increase Fortis's generation capacity to 740MW or by over 38%. Stations were installed 1907 through 1932 and consist of 41MW Lower Bonnington (Plant 1019975), 59MW Upper Bonnington (Plant 1019976), 55MW South Slocan (Plant 1019977) and 50MW Corra Linn (Plant 1019978) all on the Kootenay River in southeastern British Columbia. This will increase Fortis customer base by to about 900,000 of which 85% will be over five provinces in Canada.

Fortis Incorporated was established as the parent company of Newfoundland Power in 1987. Newfoundland Power and its predecessor companies have been distributors of electricity in Newfoundland since 1885. Fortis has investments in six electric generation, distribution and transmission utilities located in New York State, Newfoundland and Labrador, Prince Edward Island, Ontario, Belize and the Cayman Islands. Through its non-utility subsidiary, Fortis has investments in commercial real estate and hotels throughout Atlantic Canada. Fortis employs over 2,300 employees (soon to be 3,500), currently has assets of $2 billion and annual sales of more than $715 million.

Aquila, Inc. is one of the top wholesalers of electricity and natural gas in North America. The company is an innovative provider of risk management products and services and owns and controls a diverse portfolio of merchant assets including power plants, gas storage, pipeline, and processing facilities.